Angel investors

Traditionally, Angel Investors were individuals who would invest in small start-ups or early stage small companies and take a share of the company in return for their money.  Nowadays, Angel Investors may be individual people or companies that have chosen to invest in early stage small businesses.  
Always remember that any person or institution that lends you money wants to make a return on their investment. Angel Investors are no different. If they do decide to loan you money, then an agreement will be drawn up clearly stating the percentage ownership of your company they will gain and how and when they expect to exit. This means that you would buy back the ownership share at an agreed upon price. Remember that when Angel Investors buy a share of your company, they take a huge risk. If the business makes a loss, this impacts on them as well since they share in the profits and the losses. As a result, they invest for a set period of time with the expectation that the business will do well and that when you buy back the shares, they will make a good profit. Many Angel Investors like to be involved in the management of the company, or at least be provided with regular management updates. Angel Investors can be a good resource for new entrepreneurs because of their skills!

How Angel Investment works

Angel Investors will want to know a lot about your business idea and how you intend making the money. If they can’t see how you differ from your competitors, it is highly unlikely that they’ll fund you. They will also want to know a lot about you, as the business owner, and your team.  In particular they need to feel comfortable that you have the necessary skills to make a huge success of your business. 

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